The UK Government has passed the National Security and Investment Act (NSIA), introducing a whole new national security vetting regime.
This will have a major impact on investments in sensitive sectors and technologies and may affect how acquisitions and investments in any sector proceed. Businesses should be factoring the changes into their acquisition and investment plans now.
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UK NATIONAL SECURITY AND INVESTMENT ACT 2021 (NSIA): NEW REGIME FOR SCREENING TRANSACTIONS FOR NATIONAL SECURITY RISK
The NSIA received Royal Assent on 29 April 2021. It will usher in a new stand-alone national security vetting regime that will replace existing powers to scrutinise mergers on national security grounds. The Secretary of State for Business, Energy & Industrial Strategy (BEIS) will be the key decision maker, with significantly expanded powers to scrutinise and, where necessary, impose remedies on certain acquisitions and investments that have national security implications. The new regime will apply to investments/acquisitions by investors from any country, including the UK, and without any form of minimum turnover threshold or market share safe harbour.
The new mandatory notification regime will become fully operational from 4 January 2022. Once operative, however, the NSIA may be applied retrospectively to certain transactions completed between 12 November 2020 (when the Bill was introduced to the House of Commons) and the commencement date.
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WATCH OUR VIDEOS FOR FURTHER BACKGROUND ON THE ADVENT OF THE NSIA
Al Mangan and Giles Distin discuss the practical implications of the National Security Bill, as published (recorded December 2020)
Al Mangan (Competition) and Carolyn Krampitz (Trade) outline the regime that the NSIA replaces and the interim "quick fix" measures that were introduced, and discuss the longer term proposals for reform which have led to the NSIA (recorded November 2019)
Want to know more?
Explore the development of the UK Proposals and developments on FDI in other countries in the articles below
– UK National Security and Investment Bill to introduce new vetting regime >
– National security vetting of corporate transactions in the UK >
– COVID-19 and foreign direct investment regulation around the world >
Get in touch if you would like to discuss the changes to the UK national security regime and how these may affect your business.
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